It is here – I predicted it that after Transsion – the parent of Tecno, Infinix and Itel- has conquered mobile devices, in Africa, it would move into platforms. Platforms give you customers, devices produce consumers. Today, we are learning that PalmPay has moved into the big league. Yes, through Transsion, PalmPay has a $40 million war chest to battle deeper into the African fintech sector. The decade of application utility is around the corner, in Africa, and that inflection year of 2022 cannot come faster. In Nigeria, “PalmPay will offer 10% cashback on airtime purchases and bank transfer rates as low as 10 Naira ($.02)”, notes Techcrunch. In other words, as you use it, you get paid!
Africa focused payment startup PalmPay has launched in Nigeria after raising a $40 million seed-round led by Chinese mobile-phone maker Transsion.
The investment came via Transsion’s Tecno subsidiary, with participation from China’s NetEase and Taiwanese wireless comms hardware firm Mediatek — a Transsion spokesperson confirmed to TechCrunch.
PalmPay had piloted its mobile fintech offering in Nigeria since July, before going live today at a launch in Lagos.
The future of the publicly traded Transsion cannot be selling hardware – services provide a deeper sustainable path. Hardware reaches maturity, reducing margins, while services could be likened to the tree that produces cash as fruits. PalmPay will offer a package of mobile based financial services, including no fee payment options, bill pay, rewards programs, and discounted airtime.
Like MTN, OPay and others, PalmPay has the Central Bank of Nigeria (CBN) mobile money license. And it has one advantage: if most Africa users depend on Transsion devices, it means the PalmPay app being pre-installed will create millions of entry points on day one.
“On channel and access, we’re going to be pre-installed on all Tecno phones. Your’e gonna find us in the Tecno stores and outlets. So we get an immediate channel and leg up in any market we operate in,” said PalmPay CEO Greg Reeves.
The future looks exciting for consumers. But for those in the heat, it is getting hotter! Why? The Chinese are not buying local startups – they prefer to start from scratch. What does that tell me? Simply, the market is still at infancy; no one has won yet. And I do believe that, because cash remains king in Africa and eating the “ 98%” with software, is a massive generational opportunity, in places like Nigeria where the central bank started the party of all-time with digital money license galore!